Why claimants have a legal requirement to contribute 25% of any compensation settlement towards their costs should they win their claim

Prior to the 31st March 2013, claimants pursuing claims for personal injury compensation on a no win no fee basis retained 100% of any settlement awarded to them with no deductions, and paid nothing if they lost their claim. At that time, the system obliged 3rd party insurers to fully cover their legal costs and insurance costs as well as pay them compensation for their injuries and losses. From 1st April 2013, the law changed and successful claimants were obliged to help towards the cost of their claim by contributing up to 25% of their total compensation settlement and as Solicitors could no longer recover the cost of the ATE insurance premium in a claim, the claimant must also repay the cost of any such policy should they win. The current no win no fee claims system still guarantees that claimants pay no costs whatsoever should their claim for compensation fail (including for any ATE premium cover put in place).

The Laspo Act

Sadly (in our view and that of the claimant personal injury sector) the Government bowed to pressure from the Insurance sector and introduced the LASPO Act 2012 (often referred to as the Jackson Reforms) effective from 1st April 2013. This changed the way No Win No Fee claims worked and who paid what when claims were won.

Fee changes

No Win No Fee legal services remained available to claimants, meaning that they could still pursue a claim without having the worry that they would be forced to pay expensive legal fees if they lost. However, the outcome if a claimant succeeded and won their claim for personal injury compensation was very different. The main result of these changes from a claimant perspective was that when their claim for compensation succeeded, they could no longer oblige a 3rd party to cover their legal costs in full.

To compound the problem, personal injury compensation solicitors were forced to work on a fixed fees basis and submit claims via the Portal system. This saw the fees they received from losing insurers for their legal work undertaken in succeeding with a claim reduced by more than half their previous sum, whilst their work and cost burden remained the same. As a result, the only way to cover the loss created by the new law was to oblige claimants to pay towards the legal costs when they won.

Insurers claimed that the cost burden they faced when losing a claim was too great and that solicitors were greedy, charging excessive costs and benefiting from encouraging claims and maximising claim settlements. As a result No Win No Fee solicitors were also banned from charging losing 3rd parties a success fee and the Government wholeheartedly agreed with the Insurance sector view that successful claimants should contribute to their legal fees.

The Government decided that when a claimant succeeded with their claim and was awarded a compensation settlement, they would have to contribute a maximum of 25% of any settlement awarded to them which would be deducted by their Solicitor and used towards their costs incurred for running the claim. Further, successful claimants could no longer claim the cost of the insurance premium (ATE cover) that they had taken out from the defendant insurer and would now be obliged to pay that cost from their settlement in addition to the 25% deduction from their settlement award. It should be noted however, that the specialist partner Solicitor firms who pursue the claims Direct2Compensation claimants, work hard to minimise the deductions from claims.

Why did they do it?

The Government took the view that by changing the law relating to No Win No Fee claims for compensation and obliging a deduction from any successful claim, that they would achieve one of the insurance industries key goals – to reduce costs faced by the insurance companies, who form the vast majority of defendants in personal injury claims. For years, the insurance sector via their public mouthpiece, the ABI (Association of British Insurers) whose members had to pay the injury compensation settlements, special damages claims and legal costs when they lost a claim, had decried the ‘unfair’ burden placed upon them by what they labelled extortionate costs caused by the compensation culture sweeping the UK. Of course, the reality was that there never really was a compensation culture, it was just people exercising a legal right to pursue a claim for compensation when they were injured because of the negligence or actions of someone else.

It is interesting to note also, that during this same period when insurance companies decried their cost burden and tried to place all claimants in the ‘trying it on’ box, that their profit margins continued to rise as did the premiums that they charged to motorists, businesses and organisations. In a bid to further increase their profits, they convinced Government to agree that successful personal injury compensation claimants should pay towards the cost of the claims process. As a result, the Government amended the law so that successful No Win No Fee personal injury compensation claimants were obliged to contribute up to 25% of any compensation settlement towards the costs of the claims process as well as paying for any ATE insurance cover from their settlement. Government framed this change as being a move would benefit the wider consumer public as insurance premiums would decline, saving us all money. The Insurers promised that they would pass on the benefit of reduced costs to them by reducing insurance premiums for Motor, Public Liability, Employer Liability and many other insurance policies.

To summarise, the 25% deduction from compensation element of the LASPO Act 2012 and personal injury compensation claims after 1st April 2013, was brought in to reduce the costs faced by a losing insurer. It’s interesting to see that despite their promises and the lower cost burden that they now face, insurance premiums have not reduced in price. Indeed, premiums have risen way above inflation and profits have followed suit.

It’s still worth claiming

Regulated, compliant personal injury claims management companies such as Direct2Compensation and the expert personal injury compensation solicitors with whom we partner fought hard against the introduction of the new regime. Those of us who work in this sector could see that the changes were inherently unfair and in the favour of the huge insurance firms. Alas the Government pressed on. So whilst it isn’t fair, it is the system in which we are obliged to work. Losing 25% of a claim settlement and having to cover the cost of insuring the claim against failure (ATE), when the whole point of making a claim is because you’ve been disadvantaged by someone else’s negligence is far from ideal, but getting 75% of something is better than 100% of nothing. We fully believe that it is still worth making a claim and the new system just further enforces the point that it is vital to maximise any claim settlement.

ATE premium costs cannot be recovered so must be paid by successful claimants, but only if a claim is won. It is important to remember that ATE cover only needs to purchased if a claimant does not already have suitable cover. Suitable existing cover would be ‘legal expenses insurance’ – also known as BTE (before the event) insurance. It is important to discuss this with your Solicitor before asking them to provide ATE cover for you. Many people have BTE cover already and it can be attached to motor insurance policies, home & contents insurance cover, financial products such as credit cards or through union membership. If you would like to find out more about ATE & BTE insurance cover, please contact us or ask your Direct2Compensation specialist solicitor.

About Ian Morris

I've been involved in the management of personal injury claims for nearly 20 years. Outside of work, I'm married with 2 beautiful daughters. I love surfing, snowboarding and spending time with my family. You can find me on Twitter.

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Questions & Answers

Dale 22nd May 2020 at 7:24 pm

If I receive a valuation of 2200.00-2450.00 with No Mention of Any fees I take it this is the amount I should receive after the 25% Deduction

Firms may charge more, but it is a rarity for any firm to do so and claimants should not be asked to contribute such a high deduction from settlement. The standard legal requirement is a deduction of 25% (including VAT).

Hi What if you’ve taken out a no win no fee, and you’ve been offered a cost inclusive offer of 18,500 can the solicitor then only pay you 2,500 from that Has they say the fees are 36,000 and now there saying they think it’s to risky to take to court and we would have to pay private, they never discussed anything like this before until other day? Regards

A Solicitor must always act in the best interests of the claimant (their client) and therefore, they must not attempt to coerce you to settle a claim unless their genuinely held belief – based on the facts of the case at hand and their legal expertise/opinions from Counsel – indicates that it is in your best interests to accept an offer that has been made.

In terms of the legal costs, if you have signed a retainer with your Solicitor that enables them to deduct up to 25% of any compensation, that should be adhered to. If the agreement allowed them to deduct more, then they may have a legal position that enables them to recover the bulk of their costs.

If you are not confident that your Solicitor has done this, the first port of call is to make a formal complaint to whichever firm it is via their complaints procedure – which should be published on their website. This would enable a senior partner within their firm – who has not had any involvement in your case – to review the matter and decide whether they feel that more could be done or if the work has been handled correctly. If they are unable to satisfy your concerns, you could then escalate the matter to the regulators or legal ombudsman and have it reviewed independently.

Hi, I’m happyish with the 25% payment, however the claim we have underway also stipulates “disbursements” will also be deducted but does not state what these will be. I understand they cover many things but it seems very vague, will they be considered in the final total or an additional amount we pay?

This usually means that a Solicitor ‘may‘ have to deduct disbursement costs from a settlement but only if the legal costs that they are able to recover on success have yet to be forwarded. For example, if a client settlement is paid, but the legal costs are not forwarded, a Solicitor may take the costs that they have incurred from the settlement and then reimburse the claimant when their legal costs are also forwarded.

Essentially, at the end of the process, you should only contribute up to 25% of any awarded compensation.

If we arrange a policy for you, the work carried out in arranging the same will be charged in accordance with our hourly rate and subject to the 25.00% (plus VAT) cap as set out in the CFA document. The work carried out by us before the policy starts will include explaining to you what the policy covers and does not cover, providing the necessary information to the insurer for the policy to be issued and checking the policy documentation received.

Are they allowed to charge me the vat on their 25% of the claim it mean they get all their costs paid, 25% + vat they will get more than me?

hello i was involved in a accident whilst driving a hired Taxi. my solicitor said at the start the Taxi hire company gets 500 pounds for recommending the solicitor company at the end of the claim but it comes from the solicitors end not mine. how can i check this as been dealt with in that way and the Taxi companies 500 pounds { kick back } as not come from my 75 per cent?

Hopefully, you have instructed your Solicitor to act on a No Win No Fee basis – signing instructions that afford the Solicitor the ability to deduct up to 25% of any awarded compensation. If that is the case, you have nothing to be concerned about.

If you do have concerns about the Solicitors and their agreement with the taxi company, you could consider reporting them to the Solicitors Regulatory Authority to check whether the agreement that they have in place with the taxi company is legitimate and within the regulatory framework. The regulator can investigate the matter and if anything untoward is found to have happened, they will deal with it.

I was told and signed in agreement with my solicitor that he would take on my personal injury claim for 25% plus £500 insurance, but now his ready to put forward a figure to the liable insurance company, he has asked me to sign excepting the condition of apart from what we have already agreed, his expenses of over £6000. The claim his putting forward is only£16000 of which he thinks we may get £12000, this will give him, roughly 75%, which to me is immoral. How do I stand.

We wonder if you may have misunderstood what your Solicitor is asking to to agree to and why. The initial agreement you signed with your Solicitor (Conditional Fee Agreement) instructed your Solicitor to act on the basis that you pay nothing if your claim failed, but allowed them to deduct up to 25% of any awarded compensation should you succeed (along with recovery of any ATE premium if you have agreed to that). That agreement should still stand – although you do of course need to question that BEFORE you sign any other document. The £6,000 figure is your Solicitors costs to date. Your Solicitor should only ask you to agree to those so that they can recover as much as possible from the defendant.

Sadly, recovering the 25% deduction is almost impossible given the changes made to the personal injury claims industry by the UK Government effective from 1st April 2013. When the system was changed – at the behest of the Insurance industry – the government introduced legislation that prevented a successful claimant from recovering ALL of their legal fees on top of compensation. The Insurance sector argued that it was not fair to have to pay compensation as well as cover legal costs if they lost and the Government bowed to their financial pressure and agreed. The legislation reduced the amount Solicitors could charge and reduced the amount of fees a claimant could recover and obliged successful personal injury compensation claimants to contribute up to 25% of their awarded damages and recovered lost income towards the costs of the claim.

However, in a very few cases, some claimants have been able to recover the 25% due to specific ‘Before the Event’ (BTE) insurance cover (also known as Legal Expenses Insurance or LEI) that they had in place before their accident. The vast majority of people would not have such cover.

Not so much a question rather a statement. I won my accident claim which awarded a modest £1500. By the time the solicitors finished, they took a success fee deduction of £382.56 inc VAT and an ATE deduction of £369.81.

Your ‘story’ is one that our side of the industry predicted would happen when the Government first considered heeding the Insurance lobbies desire to reduce claimant settlements and rights.

As claimants must now contribute up to 25% of their awarded damages – something the claimant sector always fought against – and cannot recover ATE premium fees, many claimants are left feeling as you do.

Our Solicitors now rarely use ATE cover as the premium cannot be recovered and we feel that such cover is effectively a pointless expense (in the majority of cases) that most claimants do not need.

The 25% deduction should include VAT and will be taken from the entire settlement – including special damages. However, if any part of the claim settlement relates to FUTURE loss of income or FUTURE medical costs, there should be no deduction from that element of the settlement.

Hi Ian, I instructed a legal firm to fight a critical illness claim for me and the CFA I signed stated that the opponent will pay my legal fees if we win. The insurance firm finally agreed to a payout of the policy after some back & forth. It appears now my legal representative is withholding substantial amount of money by claiming it’s for their legal fees after deducting the agreed 50% success fee. This is clearly in breach of the CFA which says that I am entitled to recover the legal fees if we win from the insurance firm. The opponent has refused to cough up the legal fees but I will be significantly out of pocket as a result despite the CFA. I’ve complained and now the legal firm wants to negotiate. What % basis can I ask for to refund and/or what other form of redress can I get to conclude the matter? Many thanks

Without knowing the full contents of your CFA and the reasoning given for a deduction by your legal firm, it is of course, hard to advise properly. You should go in with the starting point being that you signed an agreement that afforded you a zero deduction service and that you fail to see why you should now have to sacrifice a substantial portion of your damages due to an issue that is beyond your control.

You may also wish to escalate your complaint to the regulatory authorities and the Legal Ombudsman in order that they can assist you and potentially secure you the full settlement.

Hi Ian I was injured in an RTA Oct 2019 where the other party admitted full liability. Their insurers contacted me and sent me to physio – I 14 sessions. Physio signed me off and said he’d note I wasn’t a 100% better, to continue with self care and to go back if I needed. Insurers then offered me £1900 (I am a carer for my son so I’m not claiming lost earnings.) I turned this down after researching, and said it was at the very lowest in the bracket of recovery within 3 months – this was at 4 months after the rta. Insurers asked me if I’d have a medical exam. I agreed and I received the report –

The insurers have now offered me £2900 plus £280 for 8 physio sessions.

My questions are, is this a reasonable offer? It’s difficult to get a consistent ball-park figure online – I thought injury solicitors weren’t allowed to inflate! Also, what are my chances of going back and asking for a higher offer? What would you think is reasonable?

I just want this done and dusted, particularly with the awful situation the country is in.

I appreciate your desire to get this matter resolved and move on – of course, if you were to instruct a Solicitor to act, I would anticipate that they could obtain a more acceptable level of damages for you – but that would delay this matter considerably.

Therefore, you have a choice to make! I think the offer is at the base of the appropriate value range and I would be inclined to reject the same and make a counter offer to the insurers. That may take a few weeks longer, but could see you obtain an increase. Alternatively, you reject this out of hand and place the claim with a Solicitor and allow time to pass in order to obtain a higher settlement. Of course, it comes down to what is an acceptable offer to you.

I am currently disputing a matter of ATE premium on a personal injury settlement I have waited more than 2 years to receive and still didn’t. The pevious firm has gone into insolvency and therefore the case and the cheque was handled by another firm. Now they would like to send me a cheque of £75 (out of £500 as it was decided in the court) which seems totaly unfair as they said that apart of the 25% deduction they had to retain the cost of ATE which was not presented to me in the first place. What do you suggest doing moving forward?

It is correct that a successful claimant cannot recover the cost of the ATE premium that is taken out for their claim. Therefore, you would have to cover the cost of the ATE premium from your own settlement. However, the cost of the ATE should have been made known to you BEFORE you signed to agree to the same. If you were not made aware of the cost of the ATE, you should complain – firstly to your Solicitor (or whoever sold you the policy) and if that does not resolve the issue, then escalate the matter to the Solicitors Regulatory Authority, Legal Ombudsman and potentially the insurance ombudsman service.

It is not possible for us to advise on this specific issue as we do not know the terms of your IVA. Indeed, or if it could be the case that you don’t have to pay any part of it – your Solicitor should be able to link you with a specialist who is able to legally minimise any exposure you face of losing your compensation.

Hi Thank you for replying. Can I ask my solicitor to show me some documents? Settlement or other, so I can see fee was deducted. At the moment I receive only cheque without any explain… They didn’t show me any documents…. I would like to know what documents solicitor have to show me? But not ask me for cash from my cheque….

Hi My solicitor asking me to pay him 25% from my cheque. Is this is legal. Can you please advise me, when fee of 25% is deducted? Before I receive cheque, or when I receive cheque. Or amount on cheque is just my. I’m worried about if they try to charge me twice.

The way any fee will be calculated and then obtained should have been explained to you in full at the outset of your claim before you signed your Solicitors paperwork.

The ‘standard’ procedure for claims made on a No Win No Fee basis in the UK, will see successful claimants having up to 25% deducted from their compensation as their contribution to their legal costs. This deduction should be taken from settlement, before the balance is forwarded to you. You should not be asked for money up front, to receive your settlement.

Hi I was wondering if u could help me I tripped on a pothole which caused me to fall over I cut my hand open as I was holding a bottle when I fell the company put me in touch with there policy holder they have recently emailed to say they have admitted liability do I need to get a solicitor or can I continue without one as I don’t like the thought Of paying 25% to them when no one would take on my case when it happened thanks

You do not have to instruct a Solicitor. Indeed, you will certainly receive a settlement whether you instruct an expert specialist personal injury Solicitor to represent you or if you continue to handle this matter alone. Liability is admitted in your case, therefore settlement will follow regardless of your decision.

Now that liability is admitted, the claim moves on to proving the extent of an injury, the appropriate settlement value for that injury and the associated losses & costs caused by the injury. This is where having the representation of a specialist personal injury Solicitor can prove vital. Our specialist personal injury Solicitors know your rights and have the expertise needed to properly hold a defendant insurer to account when settling a claim with it being more likely that a fair and upper end settlement is received by the claimant.

Whilst there can be no guarantee that a Solicitor will obtain a settlement the is 25% higher than the one you could get claiming directly, there is also a huge benefit to having a Solicitor acting for you on a No Win No Fee basis. Claiming with such representation can protect you from the risk of ANY costs should you fail with good prospects of obtaining a higher value settlement than you may otherwise have received.

You sound very capable given your initial success with your claim so there is no doubt you could pursue this matter independently. You just need to consider whether you want the hassle of dealing with the claim and the anxiety and stress of knowing whether or not the defendant is acting correctly and whether or not any potential offer you receive is reasonable or laughable.

If you decide you would like the services of a friendly, helpful and specialist personal injury law firm, please contact us further so that we can consider your claim in detail.

Hi again If I use a solicitor and they claim 25% more money it’s only the money they would take of me anyway do you think it’s worth waiting for the medical reports to be done and going to a solicitor (can sometimes get a free 30 mins ) and ask if what the most amount I could get for it after showing them the medical reports I didn’t suffer any loss for wages and stuff like that I’m a full time mom just suffered struggling to look after kids When I was without help costs I had was a taxi from hospital to a hotel £30 any further help would be grateful as you have helped me lots and I’m very pleased with the help you given me if I do decide to go with a solicitor I will defo be contacting your selfs thanks

You may be able to get a Solicitor to offer a ‘free’ consultation on the issue you raise (approximate value of your claim), but it is unlikely to be a personal injury specialist, so the advice you would receive would not necessarily be of the most specific and accurate nature. When valuing a claim on the basis of a medical report, the standard procedure is for a claimants Solicitor to instruct Counsel (Barrister) to review the experts report and provide advice on a number of issues, including the correct value range for the nature of the injuries and prognosis provided. Therefore, a 30 minute consultation will not get you that level of advice.

You are free to continue to represent yourself and see if you can obtain an offer that you are happy with. Whilst in all likelihood, you would get a higher value settlement with a Solicitor, it would of course take longer to obtain (due to the nature of evidencing and demonstrating the extent of the injuries and losses) and you would pay 25% of the award. Whilst we feel that such a fee pays for itself, if you can obtain a settlement you are happy with and can then get on with your normal life, go for it!

However, if you do need a Solicitor you can contact us at anytime for further help.

That is far too much! Our Solicitors would take no more than 25% of the compensation settlement and charge NOTHING if the claim fails. Give us a call to find out how we can help your Son make his claim for compensation.

I had a payout last year for a rtc it was a little complex but the brief of it was I got a out of court offer and was advised to take it I was offered £60 thousand but the actual offer was £121 thousand I ask why I only received £60 apparently the solicitor took £10 thousand the rest went to the benefit system and nhs fees. Is this correct and I never received any paper work brake down ??

If you received benefits because you could not work as a result of your accident, the department of wark and pensions (DWP) do have a compensation recovery unit and may recover what they are entitled to and your Solicitor is entitled to deduct up to 25% (on a standard Conditional Fee Agreement – CFA) basis.

However, without doubt you should have been given a written breakdown of the total of the claim – the total would include your legal costs, most of which would be paid by the defendant, less the 25% deduction your Solicitor would take along with what the DWP recovered. You could and should request such a break down from your Solicitor at this time.

Hi I’ve got a road traffic accident going through at the moment from September 2017 the 3rd party have claimed full responsibility I have personal injuries. My insurance company provided a solicitor which they’ve now offered me a 2nd formal offer made on a global basis part of a “Part 36 offer”. I’m of the understanding with a global offer they deduct 25% from my compensation settlement towards their cost, can you confirm does every solicitor take this deduction or is it just “no win no fee” companies/services that do this? thanks

I’m reaching the final stages of an injury claim from a car crash, i was off work for nearly 6 months so I’m also claiming for my loss of earnings, are solicitors entitled to take a percentage of my loss of earnings as i’m pretty sure they’re not as it money i would have earned i.e them taking a percentage means I’ve lost money that would have been mine if i wasn’t in the car crash

A standard Conditional Fee Agreement for a personal injury compensation claim will enable a Solicitor to deduct up to 25% of the total awarded compensation – including loss of income. However, if there is any element of the claim value that is for future loss of income or future medical costs there should be no deduction.

I took out a no win no fee offer on a dental injury case. I won and the outcome I was awarded damages of £23,642.61 and the solicitors costs were assessed by the Court in the sum of £65,471.88. The defendants solicitors have now offered a settlement of 34000 in total, and the solicitors want to pay me 26.5% of this as a pro rate basis. Expressing an equal split based on what was awarded in court. Is this correct? Should I accept?

Whilst we do not handle matters of clinical or dental negligence, it is odd that you appear to be expected to agree to a settlement that is far below what you have been awarded.

If we have understood this correctly, the courts have awarded you £23,642.61 and your legal fees as £65,471.88. If this is the case and the court have awarded this sum to you, why are the defendant Solicitors not agreeing to settlement as per the judgement?

It is a tough situation. If your Solicitor feels that you are unlikely to be able to obtain further or higher awards by rejecting the offer and going to court, then you may wish to take their advice and settle. Have you asked your Solicitor if they can pursue this further?

There is certainly nothing to lose by attempting to negotiate a better ‘split’ with your Solicitor. After all, this is your claim and they should be acting in your best interests!

Kelly 4th February 2020 at 3:00 pm

Hi,

I have recently had an a suggested value of offer to put forward to the company I am making a person claim against. They have suggested £28000, the fees are £8400 (25% plus VAT) the ATE is £224 and a bank transfer cost of £25 plus VAT. I have never been in a situation like this and I am only in my late 20s, I just want clarification that this is about right and the figured are accurate? The claim had been going on for over two years now and I did have approx a year off work from my injury. I have felt like my solicitors haven’t cared about me over the last two years. I have had to do a lot of chasing and rather than it be me and my solicitor against the company, I have felt like it has been me against both of them at some points during the claim. Any advice on how to consider acceptance of a figure or how to progress forward in general would be very much appreciated.

It is simply not possible for us to comment on whether or not an offer of compensation or a suggested claim value is appropriate. We say this as we have not seen a medical report and do not know the extent of the injury and whether or not you have recovered or will recover.

Before you agree to the suggested value, you should ask to see a copy of the Barristers opinion (as they would have assigned a value range to your claim based on medical report evidence etc) and ask for clarification as to why this figure is appropriate. You should also query your loss of income and incurred expenses since the injury was sustained and ensure that everything is accounted for in terms of settlement value.

I have just Accepted a £20,000 Compensation offer, but my Solicitor is saying I have to pay £4,000 in VAT, and the Solicitor said he is taking £8,000 instead of £10,000, Barrister £1,750 and the Doctor’s fee was £850, I have asked him for copies of Original offers but he just sent an ordinary email with the above details, sounds a bit dodgy to me.

Is this a personal injury matter? Why should you be paying VAT? You need to get to the bottom of this quickly – we would suggest complaining to the Solicitors first of all and potentially then escalating the complaint to the ombudsman.

You need to refer to the agreement you signed when you instructed your Solicitors to act for you. They should only deduct 25% from the settlement plus any ATE premium. The only other deduction could be if you have to provide some of the settlement to cover the costs of already provided rehab therapies.

Hi there i have had the help of a solicitor firm as I was involved in an accident long story short I received a cheque only yesterday for £650 and they took £3800 for fees which I had no idea about I was told they would take %25 of what ever they received I thought they claim their money off the 3rd party is there anything I can do about this?

Have you queried this with the Solicitor practice? It could be that they will be forwarding further funds to you in due course and that they have simply received part of the legal costs from the defendant (from which they can take their fees) and then the settlement balance will follow afterwards.

If this is not the case, you should immediately contact the Solicitors Regulatory Authority and legal ombudsman service and complain.

My mother fell back onto her head breaking her neck and back. She has a spinal injury and will never be able to walk properly again. She is being forced by her solicitors to accept £30,000 and £8000 of that will be paid to her work and I’m unsure what else will come out of it but I know she will be left with about £15000. She has not fully recovered And probably never will. The solicitors have not requested and further doctors reports and my mom does not want to accept the offer. What can she do? And is this a fair offer?

It is of course very hard to second guess the work of the Solicitor acting for your Mother. We don’t have sight of the medical report or Counsel opinion, so we don’t know why the value that is being mentioned is being mentioned. Whilst £30k is a large sum of money, it doesn’t seem particularly high for someone who will be left permanently disabled. If your Mother will no longer be able to work, there should also be an element of the claim that relates to loss of income.

The best course of action would be to ask the Solicitor to explain why (in writing) the claim is valued at £30k and why no additional medical reports are being considered.

Your Mother does have the right to make a complaint to her Solicitor if she feels that they have not properly represented her or if they have mismanaged her claim. It may well be a wise move to instigate a complaint via their published procedure to ensure that the claim and the work done by her Solicitor is reviewed.

Hello there. I currently have a victimisation and harassment case pending. I am having great trouble speaking to my solicitor on the phone at any time and I am worried about my time limits. My employer made an offer back in October which I originally declined but this has all made me physically ill and I have now been signed off work with anxiety and depression since September. Receiving SSP I recently decided that I’d like to take the original offer basically for ease to my health but I can’t speak to my solicitor to find out if I have to go through him to accept it. If I emailed my employer myself who I am already in contact with as I’m still employed and asked to accept. Can it jeopardise my case if he refuses and I asked him myself? I do believe he will be happy that I am accepting the offer but I just want to be sure I am going about it the right way. I really would like to speak to my solicitor but he is never in the office. He has only returned my call 2 times since the start of October which is very frustrating. I’d really appreciate some advice. Thank you

You have every right to feel frustrated with your Solicitors poor contact with you. It would be sensible to write to them demanding a response within 7 days and state that if they don’t respond to you, you will consider making a formal complaint.

I’m currently going through a claim against the motor insurers bureau investigators and i’ve had an offer from them to settle. Now my Solicitors have said that if i take the offer, they’ll take their percentage and send the rest on to myself. When the claim first started 3.5yrs ago I was told their percentage was 25% of my overall claim. They are now saying they want 33% plus vat on top! Is this correct and allowed? Thank you

I have just settled a claim but I knew I needed a second specialist assessment but it would have cost me £1000 which I don’t have – is it possible to claim again ? I only received £2135 which didn’t even cover the cost of my wheelchair which I didn’t need before the accident

If you accepted the settlement as a full and final settlement, you won’t be able to return for further damages. If you feel that your needs were not properly protected by your Solicitor and you feel that they have been negligent in handling your claim you can complain to them and bring that matter before the ombudsman who may make a ruling in your favour.

Hi My solicitors has advised that the TPI have offered settlement at £3000 for my injuries however the solicitor has then taken their 25% ,the £168 ATE premium cost AND the physio costs from this figure..is this correct? So offer now

Depending on what was agreed between you (with your Solicitor) and the defendants in terms of funding medical costs (physio in your case), the figure may be included in your total or provided as an extra. If the figure is included in the total sum and has already been paid for by your Solicitor, they would be acting correctly in deducting it.

Hi, I am due to settle an insurance claim (after third party ran me over). They have made a part 36 offer of a global payment. Can I insist on a full breakdown instead? Can I insist third party break down this global offer to all component parts? That way I can see how much they are paying for each aspect of claim. Eg injury, trauma etc…

The total deduction cannot exceed more than 25% of the total settlement (excluding any ATE policy cover). In most cases, any element of the claim that relates to future loss of income or future medical costs will not face deduction.

My housing association have admitted liability of negligence. I have lung disease it’s been made a lot worse due to them leaving me in my flat with a bathroom that had rotting flooring I have allergy to mould spores, asthma and I suffer with COPD. I have been hospitalised, had a change of inhalers and since a new diagnosis of my lungs.

Before work commenced the housing association were aware of my health issues but did not protect me. Now they have admitted liability, should I go it alone and claim, as a no win fee solicitor would not take on my case a year ago as they didn’t think there could be a link made. Please could you give me sound advice as I don’t want to pay solicitors fees now they have admitted liability.

Given that your Housing Association landlords have now admitted liability and negligence in this matter, you should pursue a claim against them. You do have the right to represent yourself and make a claim against the insurers of the Housing Association, but it is likely to be a more sensible choice to instruct a Solicitor to represent you on a No Win No Fee basis to ensure that your losses are properly accounted for and that any settlement you receive is of the appropriate and maximum quantum.

Hi. I know this may be an unusual question but I hope you will be able to help. If someone engages a solicitor to run a personal injury claim does the solicitor have a ‘duty of care’ to that client? In short, I am nearing the end of a claim which has not been dealt with or progressed very well at all and as a result I have had to point out a few times over the last 6 months or so that I am frustrated, anxious and stressed. I even used the internal complaint service when I was lied to by my claims handler (I won’t go into details but it can be proven) and I felt they were unnecessarily delaying the progress of my case. When the matter was looked into I received a letter which did not even address the main issue! More recently there have been severe unnecessary delays and mistakes made which have caused a great deal of stress. So much so that I have been diagnosed with a particular skin disorder that is stress related and I believe directly attributed to the (mis)handling of my case. My case is days away from completion now and I will be making a formal complaint to the CEO of this major company but I wanted to ask the ‘duty of care’ question. If I am not satisfied with the outcome of that letter then I will either contact the Legal Ombudsman or may take legal action! Many thanks for your help and also many thanks for the great service you provide in answering questions – for many people it is very helpful.

I have recently had an injury claim settled. The company handling the claim had deducted their fee of 25% of the compensation, but they have also taken a charge of 25% from my out of pocket expenses, i.e. treatments, costs of travel to medical appointments, is this correct?

Hi i am currently making a personal claim for injury after a serious accident at work. They have given us an interim payment, they took 25% plus then charged me vat on top this, doesn’t seem right, can you help? Thanks.

You should ask for a copy of the Conditional Fee Agreement (CFA) paperwork that you signed to check what deduction you had signed up to make from any award received.

As long as the amounts deducted are accurate with regards to your signed documents, then all is fine. Of course, if the Solicitor has deducted too much make them aware and they should resolve the situation.

Hi. Apologies if this has been asked before, however my partner had a RTA in April 2018. She is using Russell Worth to make a personal injury claim in which they will take 25% of the final sum awarded. Since April 2018 she has incurred expenses including mileage claims, loss of earnings and prescription charges. Can you tell me whether they are allowed to deduct 25% from these expense claims please?

The total deduction can come from the total settlement and may also include loss of income and incurred costs. In most cases, Solicitors will do all that they can to minimise a deduction from loss of income or future medical expenses, but it really does depend on the level of damages awarded and the total costs incurred by the Solicitor in pursuit of the claim.

Good morning, I have a personal injury claim at the start in my agreement I have estimated cost for this up to 25% £1120. Now we have settled the claim I’ve been informed that I need to pay £2500 which is double and then £207 for an insurance, which was originally £39. I’m not sure what I can do about the raised cost?

You should certainly discuss the issue you raise with your Solicitor and refer to the agreement you signed when you initially instructed them to act for you. If your Solicitor is not able to explain the amount of the deduction from your settlement in a way that makes sense to you and seems fair (in terms of adhering to the agreement you signed with them at the outset), you could then make a formal complaint via their published procedure. If a subsequent complaint fails to resolve your concerns, you could escalate the matter to the Solicitors Regulatory Authority (SRA) or the Legal Ombudsman Service.

I’m in the process of claiming for medical negligence and and my solicitor is awaiting for response from the defendent. My solicitor has sent me my first break down of fees to date and she expects it to rise to nearly £40,000 and said they will take no more than 25% of my final compensation . Based on these figures, what would my compensation likely to be ?

We don’t recognise the 10% additional deduction you mention. Our Solicitors work in accordance with the current legal requirements of No Win No Fee (conditional fee agreement) legal matters. This confirms that you would pay no costs whatsoever to any party should your claim fail. However, if you were to succeed with your claim, the deductions that can be taken are a maximum of 25% of any award made to you along with the need to recover the cost of any provided ATE cover (as you are no longer able to recover the ATE premium cost from the defendant). Whilst ATE premium’s can vary, a typical ATE cover fee will be somewhere between £150 – £300.

Your posts are quite informative, but I wonder whether some of what I have read may need amending?

You say that the deductions from clients is capped at a maximum of 25% from damages and that it is the lower of either the 25% deduction or 100% of base fees. But as I understand it, the success fee can be up to 100% of base fees meaning if say a solicitors fees were £10,000, they would be entitled to claim a further £10,000 being 100%. obviously if my claim settled for £10,000 then they can only tale £2500 from my damages as this represents 25% but, as I understand they could seek the shortfall because that is not capped.

The key issue here is that the Solicitor CANNOT deduct from your damages anything more than the 25% of your settlement (they will also have to deduct any premium for ATE insurance). A Solicitor may attempt to recover further fees from defendants, but they are unable to take further from a claimants award.

I had a nasty fall in tesco, last august. Suffered back, hip pain for about 3 months. Solicitors took on the case (there was CCTV, in store, to see my fall) i was awarded £1,975.00…out of that, i have been left with, £1032.00, after 25% to solicitor, AND ATE cover. How do i know that i have had the correct amount for the above cover taken out of my award? It doesn’t seem right, or fair, that the accident, was no fault of my own, i suffered the injury, pain etc, yet i end up with a small amount more than the deductions. Who decides how much ATE cover is taken?

The appropriate level of ATE cover should be decided by your Solicitor based on their expertise and knowledge. In your case, as you are not happy with the outcome you should make a formal complaint to your Solicitor (see their website for their complaints policy) and allow them the opportunity to investigate their work and respond. If your complaint does not lead to a satisfactory outcome, you could then refer your complaint to the legal ombudsman service. You can get more info on hip injury settlement amounts here if it’s of interest.

Hi my son was in a fatal car crash is this correct that there take 25 per cent from you and then 10 per cent insurance cover.. he was a minor and a back seat passenger.. I don’t get why they take insurance cover when he was the driver… hope to hear back from you thank you

The standard No Win No Fee agreement for claims of personal injury (including fatality) will see a claimant contribute up to 25% of their compensation towards the costs of the claim. There should be no need for a further 10% deduction for insurance as the only possible insurance deduction would be if ‘after the event’ insurance was used in the pursuit of the claim. If so, a successful claimant must pay the policy fee for such insurance – but this is usually fairly low cost (circa £200-£400) in total.

This is an email I received after all: As you are aware there have been issues regarding the settlement of your case. This was a minor impact with causation concerns and credibility concerns and you have wavered in your instructions, confirming and withdrawing instructions, to settle which caused problems. We also had you consult with counsel who valued your case at 7500-9000 on a good day notwithstanding the issues above. The case was settled as per your initial instructions and after the meeting with Counsel we advised you to seek separate legal advice but you declined to do so and offered to accept £12500 without the benefit of independent advice. We have now had a discussion with you recently where in you raised various allegations including that the settlement could have been more and we were keeping same. This has created a situation where in our position is untenable and that you must now seek independent legal advice in order to reach a resolution on this case. We trust we shall hear from someone in due course.

The solicitor never mentioned to me anything for independent advice, however I did this about 3 years ago and valued my case at minimum £ 30 or more. I did agree to settle the case at £12500 because I have been tired after 5 years from all this trying to persuade my solicitor to ask for more. My solicitor insisted me to accept a £7500 previously as a fair settlement if followed his advise i have been lost 5k, same with his counsel.

I don’t understand when he already settled the case as he said and without shown me any settlement paper or invoice how independent advice will help? I believe if this has been settled it cannot be re-opened.

I never told him that he is keeping any money but i told him over the phone that without provide me an invoice from the defendant or settlement paper how do I know how much money he received in total and who signed the paper work nothing more than this,

Thank you. We agree that it is vital that people injured in accidents understand their legal rights and understand what they can do in terms of making a claim for compensation.

Ian Morris 31st July 2019 at 6:11 pm

As you are not happy with the explanation given to you by your Solicitor and clearly have a desire for their actions to be reviewed, it would be sensible to make contact with a professional negligence Solicitor so that they can advise you in detail on this matter.

I had an RTA 5 years ago, with permanent TMJ damage, my solicitor settled the case on £12000 which I believe and based on third party too low and should been 3 to 4 times more. I was forcing him to go to the court but he not wanted this in any way and initially force me to accept £7000 which I refused. I always had the feeling and he was so tight that he was paying from his pocket. I have been very tired from all this and agreed on £12000. but no paper work done for this. He said that settled the case without me signing any settlement paper and no answer given to this. I asked for the final settlement copy but he is refusing to give me this, is not telling me what the total amount was that he received from the insurance. He asked me to accept part of money of £12000 and some will follow a week after which I refuse. Three months after he is not responding to my calls, emails or messages left in office. I don’t really know what to do with this or how to proceed.

You should immediately complain officially to your Solicitor (find their complaints procedure on their website) and also refer the matter to the legal ombudsman service and also to the Solicitors Regulatory Authority.

Good morning, I settled a personal injury professional negligence claim last year. I accepted a part 36 offer of £150000, I only received £40000 from the compensation and now the solicitors are wanting £50000 back for their costs plus interest, so the claim could leave me £10000 worse off than when I started, are their fees capped at 25% of the compensation? Be grateful for any advice.

If you pursued your claim on a Conditional Fee Agreement (No Win No Fee) basis, your Solicitors fees and restrictions upon them should be clearly set out in the agreement you signed. Your Solicitors fees should be capped.

Your Solicitor should be entitled to deduct 25 % from all of your past losses – so that would include any out of pocket expenses incurred, general damages for the actual injury/pain/suffering, loss of earnings, care etc. When calculating the deduction our Solicitors normally exclude treatment costs and leave those 100% intact but this is optional and will depend on the nature of the claim and the work undertaken by the Solicitor.

The 25% deduction doesn’t come off any future losses – for example future loss of earnings, disability on the labour market, future care costs or future treatment costs etc – it only applies to past losses.

Incidentally, and most confusingly, the success fee is not always a full 25%. It has a double cap. It is capped at 100% of the value of the actual costs we incur, or 25% of the compensation – whichever is the lower of the two figures. By way of example, if the claim settled for damages of £20,000 and our Solicitor had done work to the value of £3000, then the most our Solicitor could deduct from the compensation would be £3000. (25% would be £5000 and so the £3k would be the lower of the two figures). Conversely if the claim settled for damages of £20,000 and our Solicitor had done work to the value of £15,000 then the most they could deduct would be the 25% at £5000.

I had a cold call from Hhlegalservices saying that they can try and recover money from my solicitors I used in 2013 after the car accident in case they took too much. They called it claim for unfair compensation deductions? what is it and should I not agree to that? Is this company legit?

My accident claim offer from the 3rd party insurer is £3500, less 25% then another deduction for ‘unclaimable legal costs’?! The latter was never mentioned so what is it please? My Solicitor will receive £1000, whilst I am left with £2500?

I am unable to say what the ‘unclaimable’ legal costs are and there is clearly an issue that needs to be clarified by your Solicitor here. You should only be making contributions to costs that were explained at the outset of your No Win No Fee claim. This should be the 25% deduction and possible cost of ATE insurance cover – usually £150-£250.

In your case, your Solicitor needs to explain to you the full extent of the deduction. It could be that they have also had to deduct a fee for ATE cover if you required that for your claim.

Hi Ian, I have received a settlement offer for £3000. My solicitor has made following deductions: £750 25% Fees £500 physio £143 ATE This leaves me with around 50%.

I am disappointed that the physio cost is being passed onto me. Is this normal? Solicitor says global offer for injury would have been £500 if third party covered physio cost so I’m not losing money. I am not sure how truthful they are being. Also cheeky that the 25% is being charged on the gross £3000 sum before physio is being deducted, not on the £2500 i am left with. Finally the physio cost seems to be inflated. Like for like physio for initial assessment + 6 sessions is £300 if I booked with the same physio directly.

In most cases, where phsyiotherapy is provided it is usually funded by the defendant, but this can be by way of inclusion in the final settlement sum (which would therefore need to be deducted and passed to the rehabilitation provider). In your case, you should complain formally to your Solicitor so that they are obliged to run through this all and respond to you to explain in full how these figures have been reached.

Many daughter has just been awarded £216000 from the CICA Her solicitor has charged 25% for the work plus another £8000 for medical report which £750 was for a rewrite of a report when they got a two names spelt wrong. Two questions should my daughter have to pay for the rewrite? Secondly the £8000 for reports seems excessive as it included taxi fairs for the solicitor etc

My daughter will need support for the rest of her life and have only £147000 out of a claim of £216000 seems excessive.

You mention a very substantial settlement, so it would be reasonable to expect that some of the costs of the work involved would also be substantial. However, £8,000 for a medical does seem excessive. Whilst it could be legitimate, this is something you should query with the Solicitor and perhaps ask them for a written explanation of the costings and deductions. If you are not satisfied with their response, you could then escalate this matter and contact the Legal Ombudsman Service so that they can independently review this for you.

I had an accident on 21st August 2015 and a claim for personal injury had been taken on by Slater Gordon and had been handled by them until last month when I was paid out a very low sum than what I was told or expected. I was told at the very outset that I would get some £2,000.00 and at that time I had not been for any tests or seen any private doctors. They stated I would be awarded a substantially higher amount if they took the case on. This was when the matter was initially taken on in 2015.

This is the letter sent back to me and I have not banked this cheque of £746.25 as I had not told them to settle prior to the hearing which was set for June 2019 but they went ahead and I have now been paid a total sum of approximately £1400.00. I do not understand when I am still in pain and still have chiropractic appointments (a total of 18 so far) and physio appointments (a total of 8) The injuries and pain and diagnosis came so late in the day at the end of 2018 that they could not add this to the claim !. Why they went ahead and settled without my knowledge I cannot understand. I have emailed 3 difference people who had handled my case a few weeks ago but it seems that they are ignoring me. Please see below what they had sent me in their letter of last month :

“In accordance with your instructions, we have now settled your claim in the sum of £10326.02 and can confirm as follows: Total settlement: £10326.02 Insurers Outlay £8131.02. Funding contribution fee: £548.75 ATE Premium: £258.87 Interim payment received £1200 less deductions. Amount due to you £746.25

“As previously agreed at the outset of your claim, any compensation recovered on your behalf will be subject to a contribution towards our costs. Due to the insurance policy you purchased at the outset of your claim, your contribution is limited to a maximum of 25% of your settlement amount. Therefore based on the settlement amount agreed this amount will be £548.75. Now that settlement has been agreed, payment of the insurance premium in in the sum of £258.87 is due. The total sum of £807.62 will be deducted from the settlement cheque up on received and the balance will be paid to you. Any costs incurred over and above this sum will be dealt with under the terms of the “no win – no fee” agreement (the “CFA”) and you will have no further liability for your costs”

It seems to me that they dragged this case on for literally years just so they could make their £10,000 and yet the person suffering has been left with some £1400.00 which doesn’t even cover the costs my private appointments which are still ongoing. Had I have known this at the outside, I would not have bothered with the past 3-4 years of ongoing correspondence and emails with Slater Gordon whom I am very angry with.

Could you please advise me what I could do to take matters further with them or if there is in fact anything that I can do?

You could make a formal complaint to your Solicitors, outlining your concerns and complaint. Their complaint procedure should be published on their website and will explain how they would handle such a complaint and who would look at it for you. This will give the Solicitors the opportunity to explain the situation and rectify any errors. If they can satisfy your complaint, then great. However, if they cannot you can then refer the matter to the Legal Ombudsman Service who can review the handling of your claim and take appropriate action if any negligence is found.

I am very happy to see your prompt reply. This was just vehicle damage compensation. This was 1850, and then my personal injury compensation offered to me was 3000. Then solicitor sent me a letter citing my compensation will be 1943.12. Deducting 25 % and 306.88 for ATE funding deduction, but he also deducted money from my vehicle damage cost from 1850.

I had an accident in 2017, my opponent fault. Then they offered me repair cost. It was 1850 on their letter. But when I received a cheque from my solicitor it was 1300. It was vehicle damage cost. Can my solicitor deduct from vehicle damage compensation?

We can speak with authority on matters relating to claims for personal injury compensation. In the UK, since 1st April 2013, Solicitors acting in claims for personal injury compensation on a Conditional Fee Agreement (No Win No Fee) basis, can deduct up to 25% of the compensation awarded at settlement towards the costs of the claim. This deduction is capped and whilst it can be less than 25%, it cannot be more. (Claimants must also pay for any ATE insurance cover policy taken out as this cannot be recovered).

In your case, you mention a settlement of £1850, in which case a 25% deduction would be £462.50. However, if this is not a personal injury claim, or was not done on a No Win No Fee basis, any deduction could be different.

I made a claim using Slater and Gordon Solicitors after In was injured in a road traffic accident. I was awarded £3200 in compensation, yet I’m only receiving £2066 – over a third of my money has gone in deductions? Is this allowed?

To check whether or not the total deductions taken from your settlement are legitimate, you’ll need to check the No Win No Fee agreement terms that you signed to formally instruct your Solicitors at the outset.

What I can say is that a successful claimant should expect to contribute up to 25% of their award towards the costs of the claim and that this percentage should be deducted prior to the successful personal injury claimant receiving their compensation settlement. The only other cost that a claimant can expect to face is the cost for any ATE insurance cover that was provided by the Solicitor. As part of the reforms to Personal Injury made by the Government in 2013, personal injury claimants can no longer recover the cost of the important ATE insurance cover from the defendants and must therefore pay for it if they win their claim (they don’t pay for it if they lose the claim).

You could check with your Solicitor to ask them to clarify why they have deducted £1134 from your award. They should be able to break it down to match the paperwork you signed. Perhaps some of it is for ATE cover and it could be that some of it is for already provided rehabilitation therapies.

Can you clarify if this is what normally happens with a “Global offer.

I had put in a claim with Holiday claims and they no longer undertake holiday sickness cases and have moved me on to another solicitor and after advising that they are going to put in an offer of £8500 compensation but have stated that all I will receive will be £1500

As discussed the offer that was made was a global offer to cover the whole of the claim, including general damages, special damages and costs. *********************************************************** The offer the Defendants made was £6,000.00 if this were to be accepted then this would not leave you with anything.

It would be my recommendation, if you wanted to settle at this stage to make an offer of £8,500 which would mean that we would be limiting our costs, and Hughes Walkers costs to £7,000. I would estimate the costs to currently be in the region of £8,000 and to a trial in the region of £14,000.00 – £17,000

As advised I would not deduct anything from the £1,500 and this would be what would be paid to Bryson. You signed a no win no fee agreement with Hughes Walker that would have entitled them to deduct 29% and when you transferred to us you signed a superseding agreement which allowed us to deduct up to 25% from the damages. As agreed we will waive our right to this deduction, if you accept or make a global offer to settle the claim. If the claim continues to trial then we would deduct the 25% from any damages awarded.

I would need to check if the defendants are happy for this to be paid to you on a parental indemnity basis or if they would want that to go into a trust fund / child’s account.

When we took over Hughes Walkers file we have a duty to preserve their costs and claim the same if the case is successful. We also have a duty to pay the expert fees and any other fees paid out by Hughes Walker.

As every claim differs, the reasoning behind the situation in which you find your claim is hard to discuss. The best advice would be to request a detailed synopsis from your Solicitor as to why they have taken the view that you should seek settlement in the way they describe.

In relation to the success fee. I understand its either based on 100% costs ie 1121 in this case or 25% of damages ie 881.38 whichever is the lower ie 881.38. However my question is when calculating the 100% base costs, do they not take off what they actually recovered in this case RTA portal costs of 500 before calculating the success fee?

I have been told medical negligence case is settled and awarded all expenses, legal fees and compensation, do I still have to pay my solicitor 25% of my compensation? In addition, my solicitor has never informed me of the dealings of the case, told me I could not appear in court, and it has always been me chasing them. Initially I was told the case would take up to a year, but 3.5 years on it is still live! Can you advise.

If you have any cause for concern with regards to the conduct of your Solicitor you MUST make a formal complaint to them immediately. If they cannot resolve your concerns and satisfy your complaints, you can then escalate the matter to the Solicitors Regulatory Authority and Legal Ombudsmans Service.

My Solicitor submitted my case to a barrister for guidance on the valuation of the claim. She has returned this and advised a couple more things including the assessment of a care expert. Since this, my solicitor has now advised hat we add insurance onto the claim. He says this is due to the significant amount involved. He said this will cover any costs such as the care expert in the event we arent able to claim this back? Am I missing something? It seems a bit odd that at this late stage he is now advising insurance? For clarity – the other side admitted liability right at the beginning of the claim. Thanks

There is nothing untoward in what your Solicitor has advised regarding the insurance, indeed it would be wise to follow there advice. Given the admission of liability in this claim, you will succeed and it is clearly just the Solicitor being sensible and protecting your interests in advising of the additional insurance. Whilst you may pay a small sum for this cover, given the possible value increase that the assessment of car experts report could provide to your claim, it would be well worth taking this cover.

My solicitor has sent the details of my claim off to be valued by a Barrister before presenting it to the other side. Who will cover the cost of this? Will it come out of his 25% fee of will it be deducted from my final award? Also, any private medial consultants I have been sent to by him, where does the cost of this come from?

You will not pay a fee for the Barristers opinion and in most cases, no deductions for any medical treatment. This should all be included in the costs that you will recover from the defendant and will not be taken from your compensation. The only fees you should pay at the end if successful will be a deduction of 25% from your total award and the cost of any ATE insurance premium if you have required that (usually around £200).

The Barristers opinion is vitally important to you and your Solicitor as the Barrister is an expert and will use case law and guidelines to form a valuation range for your claim based on expert medical reports and the impact your accident has had on your life. Once your Solicitor has been given a valuation range, they will contact you to provide the details.

I have received a settlement offer from 3rd party insurance through my solicitor it says on letter that offer subject to deductions, 1 being success fee which I know and that’s fine but other is physio costs coming off the settlement offer is this right and can they do that take physio costs off my final settlement? I thought they were liable for any medical expense, confused.

In some cases, the defendant will pay rehabilitation costs as well as compensation. However, in your case they may have agreed to cover the costs of your physiotherapy as part of the total settlement value. Therefore, if they have already paid for the rehab costs, they would be entitled to deduct any previously paid costs that are a part of the total settlement from the final payment. You should of course check with your Solicitor as to what was agreed to make sure that you are not losing out.

Hi there, I had an accident on Nov 2013. My case dragged out a very long time and I’m now due payout for my compensation in the next few weeks. My contract with the solicitors appointed never references a 25% fee. Actually, it says the opposite – it says I will receive 100% of my compensation and all fees will be pursued by the 3rd party. I have also been told by the solicitors that i won’t pay any fees, however, I am skeptical. Namely, because on google reviews many many of their other clients say they were blindsided by a 25% fee despite being told they’d pay nothing. I have tried to get a confirmation in writing from them but so far, they have refused to give me any information until the payout if received. Quite poor actually and I don’t really trust that they won’t try to pull the 25% out of my comp. My question is, does the new legislation override my contract with them agreed in Nov 2013, or does what we agreed on stand regardless of new legislation? Thanks!

This is interesting and you should certainly seek advice from the Legal Ombudsman Service (and possibly the Solicitors Regulatory Authority – SRA) if the Solicitors do attempt to deduct 25% from any award made to you.

Our understanding is that if the paperwork you have signed makes no mention of any deduction from an award of compensation, the acting Solicitor is not entitled to make any such deduction from your award. If they do make a deduction of 25%, you should immediately complain to the Solicitor (look for their complaints procedure on their website) outlining that you signed terms that confirm in writing that you will retain 100% of any award made to you. If they cannot satisfy your complaint in accordance with their complaints policy, you should then raise the issue to the legal ombudsman and SRA.

Some people have insurance that will enable the recovery of the 25% deduction, but that is rare and uncommon. If you have existing Legal Expenses Insurance in place, you could contact the provider to see if you are covered.

I have settled my claim for personal injury for a rta before I have attended a medical reasons been I get anxiety when meeting new people so really dreading the thought of a medical with different doctors etc. My solicitor said I have to sign a form for the payment to be sent to them, is this correct and if so what happens next.

Yes, that is correct. The settlement will be paid to your Solicitor and placed in a client account – this means that they can’t misuse the funds. They would then make any appropriate deduction (25% usually plus any insurance premium) and then forward your settlement to you.

Is there a specified time scale for this to happen, not really happy with my solicitors atm, before I settled my claim they where so helpful on the phone etc yet once I told them I wanted to go with the first offer due to anxiety etc they were really rude and only sending the e-mails with the forms for me to authorise my cheque been sent to them, yet when I sent these emails I asked them what the next step would be and for them to verify that they received them yet they never answered and I had to phone up each time.

The release of payment to the Solicitor usually takes around 15-21 working days (3-4 weeks) and payment should then follow to you within a week or so. In most circumstances, payment is received by a claimant very promptly, but it can occasionally take longer if a defendant insurer is slow to forward the funds.

On the issues you cite with your Solicitor, if you are unhappy with their service, you should complain to them in order that they can investigate their conduct and if any errors have been made, put them right.

Following a personal injury claim after a motor accident, my compensation was paid by the Motor Insurers Bureau (MIB). I struggled to get my expenses claim paid. I feel as if my Solicitor did nothing as I was the one communicating with the MIB, writing letters and sending emails. The Solicitor deducted 25% from my compensation settlement and 25% from my out of pocket expenses – is this allowed? It was not stipulated on the contract. Kindly advise.

The standard modus operandi for regulated personal injury compensation claims handled by a specialist regulated Claims Management Company (such as us at Direct2Compensation) and specialist Personal Injury Solicitors (such as those with whom we work) is to operate under the LASPO Act 2012, which requires a successful claimant to contribute 25% from any award made to them towards the costs of the claims process – of course, claimants pay nothing if they do not succeed with their claims.

In your case, we would state two things.

Firstly, if there was NEVER any mention of the deduction and nothing contained within the Solicitors Conditional Fee Agreement paperwork that you signed at the outset, you need to raise this issue with the Solicitors immediately. In theory, they would not be entitled to deduct anything from your settlement if you have not given express permission to agree to such.

Secondly, you mention being unhappy with the effort (or lack of) that your specialist Solicitor put in to your claim. If you have genuine grievance about their conduct, you must complain to the firm in question immediately and ensure that they go through their published complaints procedure to investigate your complaint. If they cannot satisfy your complaint you can then refer them to the Legal Ombudsman’s service.

I was in a rta with my husband 3 weeks ago my insurance have appointed a solicitor to claim for personal injury they said they take 25% which is fine as 75% is more than I had. The other driver has admitted full liability. I am unsure as to whether they can take any more than the 25% I.e costs in small print I’m not aware of I don’t want to go through with it if I’m going to end up with less than them. Would you recommend any specific questions to ask. I’m new to this never done before and am so stressed out by it all. Thank you.

We would always recommend using an independent specialist personal injury Solicitor of your own choosing rather than simply taking the firm that your insurers recommend. Whether that be a firm like us or any other specialist No Win No Fee personal injury firm, it is important that you have control over any legal affairs relating to yourself.

With regards to the 25% deduction, that is absolutely fine and appropriate and is in accordance with the LASPO Act 2012. The only other deduction the Solicitors can take is the cost of any ATE insurance premium if one is needed. This is insurance to cover you against losing your case – it would pay the costs of the defendant and you would pay nothing for it if you lost. However, you cannot recover the cost of this policy from the defendant if you succeed with your claim so your Solicitor would have to deduct that – usually around £2-£300.

Hi, I have finally received a settlement cheque today for a car accident that happened back in September 2015. I received the settlement figure of £2650. But it states on the form of authority I signed online that ‘I will receive the global sum of this amount’ and does not include the ATE or the 25% fee deduction within the documents therefore am I not owed the full amount despite not mentioning these hidden costs in advance? On the other hand if these costs are to be deducted, they have taken off £360 for the ATE and £662.50 which makes the 25% but does this sound a reasonable amount or too much? Please let me know when you can, thanks.

The 25% issue sounds correct and as long as you were signed up to a conditional fee agreement that confirmed the required 25% deduction, there is no problem with that. Regarding the ATE cover provided, you cannot recover the cost of that policy from the defendant insurers if you succeed with your claim. Prior to the 1st April 2013, successful claimants could recover that cost. Sadly, successful claimants must now fund that cost from their settlement if they succeed with their claim. Therefore, 25% plus ATE premium is a standard deduction. The cost for ATE premiums varies from between £150 – £450 on average.

Hi Ian, my husband was hit head on by a car driver whilst he was on his motorbike 2 years ago. Full liability was admitted straight away. He had full motor legal expenses cover so no % will be deducted upon settlement of his claim. He sustained numerous injuries some still ongoing today but we are satisfied by the medical expert’s prognosis. He also suffered PTSD. So my questions we have are; today we received an amount the legal exec is suggesting for the injuries. We believe (but of course we are not experts) that she has seriously underestimated his claim. I have gone back to her requesting a full breakdown of what value she has put on each injury. Are we entitled to receive this. She has also deducted the physio and psychiatrist’s fees (over £2k) from his total claim. I am confused by this as it was the medical expert she instructed who recommended that my husband should have this and no conversation ever took place about who would be responsible to pay this. As an aside we have had terrible service from this company, not returning calls, taking on average 3.5 weeks to respond to an email and we are now on our 4th case handler. We are happy with the out of pocket side of the claim. What are our choices (if any) to ensure that my husband receives the full amount he is entitled to? thank you.

You do need to query with them why they have deducted the £2k+ fee for pyschiatrist and physiotherapy fees without having obtained your authorisation to do so prior to instructing the experts to provide treatment. It could be that they will go on to seek recovery of those fees and reimburse you for them in due course.

As for the appropriate value, you should be entitled to receive the Barristers opinion that would have provided the value range for the claim.

I have been awarded £2,250 net compensation in a claim for ankle ligament sprain with tears in the ligament and bruising. This happened after I stood in an unseen hole in a water board grate and my foot fell into it.

I received medical treatment, had a scan and medical via the solicitors I used. I have not accepted any offers or had any correspondence with regards to offer. The solicitors are simply saying that the £2,250 is the award.

I just wondered if that also has the reduction of 25% as this was done on a no win no fee basis and if so how much was the award before this? I also thought I had to be a part of deciding what offers I take and be aware of amounts of offers made? I just wondered if the Solicitors are being honest with me about the award amount and how I go about this or does this seem a reasonable offer with regards to injury and recovery of roughly a year? It has also been 2 years since I made the claim!?

If you underwent a medical organised by your Solicitor, you should have been given a copy of the medical experts report to agree or disagree with before it was disclosed to the defendant insurers. Did this not happen?

When it comes to the value of a claim, your Solicitor should approach you with an offer and advise you as to whether it is fair and should be accepted or if it is unreasonable and should be rejected. With regards to the £2,250 that doesn’t seem unreasonably low but without seeing the medical examiners report, we cannot say for certain whether you should have received more or not.

You need to query with your Solicitors as to how this value has been reached – has there been a Barristers opinion sought in this matter?

My solicitor advised me not to accept an offer from the defendant now they are saying I am going to end up with 20 thousand of costs (this is not a print error) my AET insurance is refusing to pay my costs because the defendants expert says I’m lying about my injuries (I wish I was) even though I have 5 experts that agree about my injuries, my solicitor said I only need to be worried about the amount of compensation I receive, now I’m looking at over 20k worth of costs due to his bad advice. I’m so worried he also said that if I lose in court I could go to jail, so I was scared and accepted an offer out of time. I’m so worried about the costs I just don’t know what to do.

If you are acting honestly and have not committed any fraud, you will have no risk of jail so please do not worry about that. If you have 5 expert opinions who on your injuries and condition, the fact that the defence has produced 1 expert to contradict that should not matter.

My solicitor is claiming 3k for hearing loss charging 25% fee plus £2k ATE I’ll end up with £250 I lost 2 days pay going to appointment & hearing tests plus fuel will end up with nothing how can they charge £2k for a ATE on a 3k claim?

£2k for an ATE premium is ridiculous and needs to be questioned urgently. Are you sure this is not a typing error? You should immediately complain to your Solicitor regarding this and if they are unable to provide a positive outcome you should immediately refer the matter to the Solicitors Regulation Authority (SRA) and Legal Ombudsman service.

Standard ATE premiums range from £110 – £220 with some policies being a little more at around £400, but I have not heard of such a high premium so can only assume that it is a typing error.

I had an RTA where liability was admitted straight away in the portal. Can solicitors still claim a success fee in this case? I thought if liability was admitted them they could recover their costs from the other side in full?

Sadly not. The LASPO Act 2012 and the Jackson Reforms to Personal Injury compensation (effective 1st April 2013) mean that your Solicitor is unable to recover FULL legal costs. Therefore, if you succeed you will contribute a maximum of 25% of any award towards the costs of the claims process.

Hello, just a quick question, I had a accident in my, which was non fault. Just had offer is it right that they are taking out the physio FEES?, I know it’s right that they take ate fee and cfa fee but don’t understand why I’m paying for my physio.

You need to check with your Solicitor on this but commonly, the cost for physiotherapy or rehabilitation treatments can be recovered from the defendant as part of the settlement. This will be the case if a medical expert has included a requirement for such treatments in their report and both sides agree to this. In your case, you should only be paying for the physiotherapy if it was something you elected to have without having an agreement in place for the defendant to cover the cost of the same.

We can only speak in terms of Personal Injury Compensation and No Win No Fee claims relating to the same. In such cases, the law allows Solicitors to deduct a MAXIMUM of 25% (inclusive of VAT) from any settlement award.

I won a claim against my former employer. They breached their duty of care which lead me to have long term condition (tennis elbow plus surgery). Solicitors said that agreed to a settlement of £15k – they deducted their success fee of 25% plus insurance. The Solicitors deducted the success fee from original settlement and sent me my settlement with a final amount from their own company (basically of the name of solicitors) so i’ve never seen the settlement paperwork from my former employer or any other document saying that they agreed on £15k. I trusted my Solicitors.

However, after few years I heard people talking that my former employer paid £55k for me and not £15k and I really do feel that my claim was underpaid. Plus I researched about these Solicitors and they do have some bad reviews from their former employees who is saying that they do underpay claimants or claim was underpaid due to them not bothering to do the job properly. Is it possible that the Solicitors faked the agreed amount? Or maybe they did receive £55k but gave me only £15k (actually around £10k after fees) And how can I check this? Thank you.

If you have used a legitimate firm of Solicitors, you probably have no concerns but they ought to be able to clarify everything to you so that you can understand that everything is correct as they have stated.

You have 2 options here now. Firstly, you should view your Solicitors website and locate their complaints policy and then launch a complaint in order to get their explanation as to your concerns. If you are not happy with their handling of your complaint, you should immediately contact the Solicitors Regulatory Authority and complain to them so that they can investigate this for you.

I have a quick question in regards to the success fee, using the expert’s example of the 25% cap whereby an award of £20,000 has been awarded on a £3,000 fee and a £20,000 award on a £15,000 fee is the figure of £3,000 and £5,000 inclusive of vat or can vat be added bringing the totally amount to £3,600 and £6,000?

Solicitor deductions must be a MAXIMUM of 25% and not more. Indeed, there is a cap as you mention. It is not allowed for VAT to be charged on top of the deduction and the explanatory note to The Conditional Fee Agreements Order 2013 states any success fee must be inclusive of VAT.

If you have not employed or instructed a specialist Solicitor to act for you on a No Win No Fee basis, it is hard to understand why the defendant insurers are attempting to deduct 25% from your award as you are not claiming any costs.

Is the deduction being taken for costs or because they are holding you 25% liable for your injuries?

Hi, I have currently a claim for loss of past and future earnings against a big chemical company after developing an allergy at work due to their negligence. My solicitor calculated my past and future loss of earnings, but I’m not happy with this as he said if at one point in the past if I got to earn more then at the chemical company there is not anymore a case of loss future earnings. I’ve explain him that indeed I’ve earned more for a certain period of time but is not the case anymore. from 5 months ago my wages are again low. can I claim for future loss of earnings in this case?

Without having full sight of the information it is clearly not possible for us to provide a qualified view. However, if the health problems you have sustained in your previous work have lead to a loss of income in the past and future, you should be able to recover the difference between your current/future income and what you had expected to receive.

My husbands RTA claim was recently settled and he was awarded £2200. From this he had to pay for ATE insurance, the solicitors fee but also the fee for physio which was £500. Is that correct? I thought the defendants paid for any medical expenses?

He was also told the final amount he would receive in the bank would be £1800 and this was stated in a letter. However, they have now said the amount in the letter was wrong and it was an admin mistake. This is totally misleading, is there anything we can do?

With regards to the amount your Husband was promised to receive being written incorrectly, there may be nothing you can do about that but you could argue that you had accepted that amount and considered it ok and that if you had been advised of the actual amount being lower, you may have refused the offer and therefore pursued a claim for a higher settlement.

The fee for the rehabilitation therapy ought to be something that can largely be recovered from the defendant but it maybe that they have disputed the requirements of such therapy and refused to pay for the same. However, if it was your Husband’s Solicitors who arranged the therapy and advised that it would be paid for by someone else, you should hold them accountable for that.

Whatever happens, it sounds as if you have a valid grievance against the Solicitors in question and it would be wise to find their complaints procedure on their website and go through that process with them. If they are unable to satisfy your complaint you could then refer the matter to the Legal Ombudsman service.

I had free legal cover as part of my car insurance when someone crashed into me. I ended up pursuing a claim with them regarding personal injury. I then received a letter from a solicitors saying they had been asked to act on behalf of the insurance company. Everything goes ahead and takes 2 years to settle. There has now been an offer and the solicitors have stated they will be taking 25% of the settlement fee. I am confused as the car insurance had free legal cover and the solicitors were acting on their behalf. Any advice?

The free legal cover would not necessarily mean that you don’t have to contribute up to 25% of your award should you succeed. You need to refer to the paperwork that you signed with your Solicitor and check with your insurers to find out whether or not this deduction is recoverable.

Hi, I have just settled my claim for professional negligence from struck out pi claim, I signed cfa, the letter of claim was £980,000, my solicitors said good prospects of success on risk assessment. 5 years on they force me to settle for £175,000, I believe very undervalued but was told if I did not accept the offer they would cancel cfa. I settled they gave me £40000 and said I have to wait up to 8 months till they can get costs from defendant before I get anymore money , but the maximum I will get will be another £38000 so a total of £78000, that is over 50% taken from my damages most of which where calculated as past loss, please help I’m at wits end, thanks very much.

Unfortunately, we can’t really offer any advice on this issue as we do not know the full terms of the agreement you had with the Solicitor and as this was a professional negligence claim rather than a PI claim, it could be different.

You should go through the complaints procedure with the firm you have instructed and see if they are able to satisfy your concerns and remedy the situation with you. If that fails, you could then go to the legal ombudsman and ask for an investigation to be undertaken.

I’m getting paid out for my claim for pi for £2650 the solicitors are taking 25% which is £662.50 but also £213.53 for ate policy is this correct I have no other losses but I thought the 25% included the ate policy.

You need to refer to your original Solicitors No Win No Fee agreement and paperwork. Due to the LASPO Act 2012 and the reforms to Personal Injury Compensation that were introduced, claimants are no longer able to recover the cost of any ATE insurance premium from the defendant insurers. Claimant Solicitors were opposed to these changes but the Government listened to the insurance lobby and forced Solicitors to deduct the cost of ATE premiums from any settlement awarded to the claimant.

If your Solicitor failed to advise you of this then you may well be able to refuse to pay the same.

The implementation of the LASPO Act 2012 prevents successful personal injury compensation claimants from recovering the cost of an ATE insurance policy. This became effective as of 1st April 2013. Prior to this, all claimants could take out an ATE policy if they didn’t have existing LEI cover in place safe in the knowledge that if they lost they wouldn’t pay the cost and that if they won, the defendant would have to pay the cost of the policy as well as the compensation settlement.

No claimant can be forced to take ATE insurance cover, but it would be unwise to not take such cover. Even in what can seem to be the most straight forward and strong claims for personal injury compensation cases can be lost and when a claim is lost, if such cover is not in place the claimant would have to pay the costs of the defendant. It is for this reason and to cover the risk of a huge bill that taking After the Event insurance cover is a worthwhile move.

Whilst those of us working within the claimant sector of personal injury law were heavily against the changes required by the LASPO Act 2012, we must abide by them and as such, although it is a pity that successful claimants have to pay a fee for their ATE cover (often around £200) it is far better to have to pay that fee on success than a huge sum in to the thousands of pounds if a claim was lost.

Me and my girlfriend were involved in an accident, a car travelling at 50mph ploughed into the back of my slow moving ford transit. I have legal expenses cover, and I’m currently in the process of claiming personal injury damages, loss of earnings, damage to personal property by way of no win no fee. My girlfriend has settled at £3000 less 25%. Can I claim back my 25% from my insurer through my LEI? If yes, is my girlfriends 25% recoverable also?

Without knowing the full cover that you have on your legal expenses insurance, it is not possible for us to say either way. We would recommend that you contact your LEI provider and discuss your before the event insurance with them and find out if you will be eligible to recover your 25% deduction.

After successful injury claim, 25% success fee was deduced. At the moment of accident i had Motor legal protection plan. Can i claim to be paid back 25% solicitors fee (expenses) from my Motor legal protection insurance?.My claim was administrated by different solicitors, i haven’t used my legal protection insurers services. Actually at that moment i didn’t know what is Motor legal protection, it was jus automatically added to my policy. And now i get call from other solicitor, they want to make claim to get back my 25% success fee, but then i need to pay them 35% success fee and other disturbances from the money they manage to get back. I am totally lost, what i need to to, and i cant find any information, is that success fee covered by legal protection. Do i need to use solicitors, or just make claim myself.

You don’t have to use a Solicitor, but is often the best way to ensure that your claim is administrated properly and the outcome maximised in your favour.

In terms of your motor legal protection insurance, whether or not you can claim your 25% fee back on that will depend on the policy and what coverage you have. If a Solicitor is saying that they would like to pursue a claim on that policy, it would suggest to me that a claim would be likely to succeed and that you are covered for such matters.

Are they saying that they would deduct 35% of whatever they recover (for the claim on your 25% deduction)? If so, you should ‘shop around’ for a better price or see if you can negotiate a better rate with them.

It is 25% of the total claim value – but only including PAST losses – any element of the claim that relates to future loss of income or future medical costs should not face ANY deductions. In most cases, we do not deduct anything from medical expenses as we work hard to make sure that any deductions from a settled claim for personal injury compensation are kept to an absolute minimum.

Hi, you raise a good question about the level of damages that can be called in to the contribution towards the costs of the claim for a successful claimant.

As you rightly state, the claimant MUST (by law) contribute towards the costs of the claim and this cost is taken from damages awarded but no fees are payable if a claim is to fail.

If you are expecting a settlement value of £200k, that is clearly a high value claim and must involve serious injuries and I would expect that a large element of that settlement value is for future loss of income and past loss of income. Whilst the deduction is set at 25% (max) of the awarded settlement, there is a cap and I would not imagine that you will have to pay £50k towards the costs of your claim.

If you have a ‘standard’ agreement with your Solicitor, they will deduct 25% from your settlement total. However, the 25% deduction will only apply to the element of the total that relates to the injury and all past loss of income and costs incurred. In this case, the deduction element would include any out of pocket expenses incurred, general damages for the actual injury/pain/suffering, loss of earnings, care etc.

The 25% deduction cannot apply to any part of the claim total that represents any future losses – such as the amount of the settlement that is made in place of a claimants inability to work in the future and therefore future loss of earnings, disability on the labour market, the costs for any future care requirements or future medical treatment costs. It only applies to past losses.

Importantly, the 25% deduction is often not the full 25% as the law applies a double cap to protect claimants. The deduction is capped at 100% of the value of the actual costs a Solicitor has incurred, or 25% of the compensation – whichever is the lower of the two figures. For example, if a claim settles for £20,000 and a Solicitor had done work to the value of £3000, then the maximum they could deduct from the compensation would be £3000 (25% would be £5000) and £3k would be the lower of the two figures so is the most they could deduct). Conversely if the claim settled for damages of £20,000 and a Solicitor had done work to the value of £15,000 the most they could deduct would be 25% at £5000.

Hi Ian, thankyou for your reply. The firm did hold back £50k till fees where payed from 3rd party and diff i had to pay. I was left with £10k approx after their deductions. Which looking at the bill they have taken the 25% off my full settlement. Could i have this reviewed by another solicitor firm or a judge. If so would i need to pay for this? Or shall i contact the Fca?

Hi, in the first instance you should raise this issue with your instructed Solicitor. If you look on their website, they should have a section that explains how complaints/grievances are raised with them and this should also show how they work to resolve the same.

If they are unable to satisfy your concerns and explain things that match with the agreement you have signed with them, you can then ask the Law Society/Solicitors Regulatory Authority to investigate for you.

Hi Ian. Just an update i tried contacting my solicitor no reply back from her. She got someone else to reply back to my email. I still was not happy with the outcome, off my charges i spoke to 4 diff solicitors and i was advised that the charges that my prev solicitors charges are totally wrong, and know have to go through all this again. Will keep you posted.

my partner a self employed private taxi driver was hit by a van, non fault. the car was a cat c write off. he had another 5 years left of a really good car but had to buy a newer cheaper car as in the area in which he works, only let cars on that are less than 4 years old. he had to pay 800 towards the other car, didn’t get a penny of the insurers of the guy that hit my partner and was out of pocket. his solicitor said he couldn’t claim for this!. so he’s is out of pocket plus the solicitor said if he had legal cover , he still would have to pay solicitors fees. he got just over 2 grand out of over three, the solicitor charged the 25% plus vat, plus ate. i an going to get him to ring his insurance again and ask for a copy of his insurance details for that year. and i am going to look at the solicitors documents if he’s not lost those. i thought from the start that this guy was a pretty useless solicitor, and no honest but my partner wouldn’t listen. the accident happened in nov 2015, his cheque finally came yesterday. we have been so out of pocket for a non fault accident and ended up worse off. could you give me your opinion on this please?

Hi, thank you for sharing your situation. I am sorry to hear about your Husband’s situation and that you feel unhappy with the outcome of his claim.

Of course, we don’t know the ins and outs of the claim here as it was not pursued by ourselves, so we can only comment generally.

Your Husband would not be able to claim the additional costs of a new car by way of his personal injury claim as the claim made via the insurers for the damage/loss of the vehicle would cover the ‘car’ element of the claim.

The Solicitor is correct in deducting the 25% from the settlement and is indeed obliged by law to do so. This is something that came in to force in April 2013 by way of the LASPO Act 2012. With the ATE premium, the claimant (your Husband) is responsible for paying the premium as the LASPO Act 2012 forbids claimants from enforcing the losing 3rd party to pay this fee as they did before.

However, if your Husband did have cover in place via his motor insurance – commonly known as Legal Expenses Insurance (LEI) or Before the Event Insurance (BTE), he may have been able to use this instead of purchasing additional cover by way of an ATE policy. His Solicitor should have checked with him at the outset of the claim as to whether he had existing cover. If they have not done this (and you can prove it!), you may be able to force them to repay the cost of the ATE premium.

I was hit by a taxi whilst on my push bike. I went through a no-win, no-fee solictors. The third party accepted full liability. The claim went through the small damages (?) portal and I accepted a settlement figure. From this settlement figure, physiotherapy and legal insurance fees were deducted. From the remaining figure, the solicitors took 25%.

I was very confused about how insurance works at the time. I also was paying for push bike insurance at the time of the crash, which included legal expenses. Would/can I still claim the 25% fee and legal insurance fee back through my then active cycle policy (are these not classed as ‘legal’ expenses?)?

Your Solicitor who pursued the claim for you should have checked with you as to whether or not you had any legal expenses (known as Before the Event – BTE or Legal Expenses – LEI insurance) before providing you with an After the Event (ATE) policy.

If the Solicitor has not done this, then they have exposed you to having to pay the premium cost that may have been avoidable if your existing LEI had been happy to insure your claim.

I am not sure whether your bike insurance will provide any come back for you, but you should certainly ask them. In the first instance, I would ask for a FULL explanation from your Solicitor.

Yes the 25 % comes off the whole claim – for both injuries and all PAST losses (all out of pocket expenses incurred, general damages for the actual injury/pain/suffering, loss of earnings, care etc). However, when calculating the deduction total, most fair Solicitors (that’s us!) usually try to exclude treatment costs and leave those 100% intact. This is not always possible, but we try to protect this for claimants.

It is really important to note though, that the 25% deduction doesn’t come off any future losses – for example future loss of earnings, disability on the labour market, future care, future treatment costs etc etc. The 25% deduction can only apply to PAST losses.

Somewhat confusingly, the deduction, commonly known as the success fee, is not always a full 25%. It has a double cap in place to offer some protection to claimants. The success fee deduction is capped at 100% of the value of the actual costs Solicitors incur, or 25% of the compensation – whichever is the lower of the two figures. By way of example, if a claim settled for damages of £20,000 and a Solicitor had undertaken work to the value of £3000, then the most that they could deduct from the compensation would be £3000 whilst the full 25% would be £5000. In this case, £3k would be the lower of the two figures. Conversely if a claim settled for damages of £20,000 but a Solicitor had carried out work to the value of £15,000 the most they could deduct would be the 25% at £5000.

There can be room to negotiate on the 25% from the clients perspective and this is something every claimant can discuss with their Solicitor before they formally instruct them to act for them.

The funding of cases is a very important issue and one that most claimants have concerns about.

Firstly, we can confirm that any work undertaken by Direct2Compensation and our partner Solicitors is done so on a fully No Win No Fee basis. This means that if a claim fails – for any reason, there is no fee to be paid by the claimant.

However, due to the requirements of the LASPO Act 2012 claimants are now obliged to pay a fee from their settlement towards the costs of the claims process. This fee is capped at 25% of the settlement award. This deduction covers any payment for injuries and previous losses but there is no deduction from any element of an award that covers future losses – such as loss of income or medical costs.

The only additional fee payable is for any ATE insurance (After the Event) cover that was put in place in the claims process. Solicitors will always discuss suitable insurance cover with claimants before they obtain ATE cover for a claimant. As such, if there is existing (known as BTE – before the event insurance) cover in place a Solicitor will use that and there will be no ATE requirement and no fee. If no BTE cover is in place a Solicitor will have to purchase an ATE policy for the claimant. The claimant will be made aware of the cost of such cover before they agree to the same.

I hope this helps, but if you would like to discuss this with us, please call us on 01225430285.

I was paid £3,830 and the accident company took 25% from me and took other money from me £240 he said this money is not attendance fees and he took other one £200 he called the one VAT. I need you to tell what to do, is this right?

Without knowing what agreement you have signed and what the additional deductions you cite were taken for, it is difficult for us to comment.

What I can say is that due to the LASPO Act 2012, it is now the case that successful claimants are obliged to contribute 25% of their damages towards the costs of the claim, paying nothing if they lose. The only additional deductions that can be made relate to the cost of insuring the claim against losing. If this is to be the case, claimants will have been asked to sign a mandate to this effect at the outset of the claim.

Hi, in 2014 i was in a car accident and have multiple injury, the other party insurers have admitted liability and i have legal costs on my insurance of £50,000 but my solicitor has me on a no win no fee agreement, is this right?

I am not 100% sure as to what it is you are asking here. Are you saying that from your settlement, that you are having to pay a fee for an insurance policy taken out during the processing of your No Win No Fee claim? If so, I can explain as follows.

When you instruct a specialist solicitor to act on a No Win No Fee basis to pursue a claim for compensation, your Solicitor will need to insure you against the costs of the claims process – should you fail. The cost of the insurance (commonly known as After the Event Insurance or ATE) is never payable if your claim fails – the premiums range from around £150 – £450 pounds, but is largely a non-recoverable cost if you succeed with the claim. Therefore, it is common that people pursuing a claim have to contribute up to 25% of their settlement towards the costs of the claim (if they win) as well as paying the ATE insurance premium cost.

You should not be paying any costs at all if your claim has failed. I would strongly suggest that you speak to your current solicitor and ask them to explain (in simple terms) what all costs/deductions you are faced with by succeeding with your claim.

Sadly, Personal Injury Solicitors working on claims that are run through the ‘portal’ system as per the requirements of the LASPO Act 2012 have to deduct up to 25% from the compensation settlements of claimants who succeed with their claims. This is not something Solicitors wanted to do, but were forced to do by the way the Government opted to change the No Win No Fee personal injury landscape in April 2013.

The 25% comes off the total settlement, including all the past losses – so that would include any out of pocket expenses incurred, general damages for the actual injury/pain/suffering, loss of earnings, care etc. When calculating the deduction Solicitors usually exclude treatment costs and leave those 100% intact but it must be noted that not all Solicitors take this view.

The 25% deduction will not be taken from the element of a settlement that relates to future losses – for example future loss of earnings, disability on the labour market, future care, future treatment costs etc etc. It can ONLY be applied to past losses.

Incidentally, and most confusingly, the success fee is not always a full 25%. It has a double cap to protect claimants as much as possible. The deduction is capped at 100% of the value of the actual costs the Solicitor who has won the claim has incurred, or 25% of the compensation – whichever is the lower of the two figures. By way of example, if the claim settled for damages of £20,000 and a Solicitor had done work to the value of £3000, then the most they could deduct from the compensation would be £3000 although 25% would be £5000. However, as £3000 would be the lower of the two figures, the deduction would be capped there. Conversely if the claim settled for damages of £20,000 but it was a complex case and the Solicitor that won the matter had done work to the value of £15,000, then the most they could deduct would be the 25% at £5000.

Unfortunately, there is no provision within the LASPO Act 2012 (and the Conditional Fee Agreement (No Win No Fee) framework) that we/Personal Injury Solicitors are obliged to work within that enables a successful claimant to recover the 25% deduction.

Solicitors are willing to negotiate the deduction percentage rate on certain claims – particularly those where the value of the claim may be high or where the claim will require very little work so it is always worth having such a conversation with a solicitor during initial discussions about a claim before any agreement is signed.

My son was injured and went to hospital, they misdiagnosed his problem, slapped a plaster on him, and said see you in 6 weeks. We went back, removed plaster he had a deformity of 33% degree angulation to his arm, he was 15. He has to have a hip bone graph and now is permanently deformed. It’s been going on for three years, but now I feel let down by my solicitor as it seems the 25% of compensation seems to be more than that..ie costs, barrister, i’m so unhappy and so very sad for my son. I feel that they are being greedy and he hasn’t won the case yet, he was 15 lost his future job, apprentice…and now it all seems so marred because we feel the solicitor hasn’t been totally straight forward.

Hi, I can understand why you feel upset, but it could be that you are not fully understanding how the charges and costs of your sons claim will be met? Of course, I don’t know the situation with your Solicitor and I would advise that you speak directly with them to find out what they are doing re making any deductions from your Son’s claim.

The amount (if any) deduction that your Son’s Solicitor can take from any settlement will depend on the No Win No Fee agreement that was entered in to at the time of commencing the claim. You mention that it was 3 years ago. If the No Win No Fee agreement was signed BEFORE 1st April 2013, your son should be on a claim model that requires the Solicitor to take NO DEDUCTION from any settlement.

However, if the claim was started on or after 1st April 2013, the No Win No Fee agreement would be different – because of the LASPO Act 2012, which reduced the amount of cost a claimant could recover and forced Solicitors to work on the basis that a deduction of 25% would be taken from any settlement awarded. The only additional costs that can be deducted are for insurance premiums if policies are needed to be purchased to enable to processing of the claim.

I hope that this helps, but I would strongly suggest that you contact your Son’s Solicitor and discuss your concerns with them so that you are fully aware of the situation and know for sure, what (if any) deductions you should expect your Son to face.

I agree that 75% of something is better than nothing, but it can’t be fair that the person responsible for causing me to need to use a Solicitor doesn’t have to pay my legal costs in full. I don’t think the Government acted fairly with this rule, letting the insurers have their cake and eat it at the expense of those claiming.

Hi Ash, thanks for commenting. Before this law became enforced, we (and many others within the industry) said that it felt unfair. Sadly we weren’t listened to and we’re now in this situation. It is what it is, so we do our best to help clients get the maximum from their claim. In the end, they still end up with more than they would if they didn’t claim. I hope you were compensated properly for whatever happened to you and that you’ve made a full recovery. Best wishes!

Thank you very much for the answer. The Supreme Court already decided that they, due to negligence and breach of health and safety made me allergic. The only question is if the loss of earnings stopped to be calculated from the date that I earned more than I used to earn at them. Basically for a financial year I’ve earned more then I used to do but now again less. For that year make sense that I won’t have a loss of earnings but in this moment should be as I earn less.

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